Janek insists pressure played no role; deputy commissioner named to job

Kyle Janek heard calls for his resignation over issues at the Health and Human Services Commission.﻿

Photo: Ralph Barrera, MBO

AUSTIN - For much of the first few months of this year, Texas health commissioner Kyle Janek weathered controversies over no-bid contracts and free tuition for top aides, as well as calls by lawmakers to resign.

"I love my job," the former Houston state senator repeated to reporters and lawmakers, stressing he wanted to fix the problems that came to light on his watch and stay on the job.

Until Friday.

Gov. Greg Abbott announced Friday that Janek would step down July 1 from the $35 billion mega-agency that oversees all health and human services in Texas.

He insisted his decision was not prompted by the scandal, the headlines or any pressure Abbott. Instead, he said, it was the "right time" due, in part, to an upcoming consolidation at the agency.

"History will show this job has a shelf life," said the 57-year-old Janek, who had been the commissioner for nearly three years, making an annual salary of $260,000.

Second-in-command Chris Traylor will take the top post at the Texas Health and Human Services Commission, Abbott announced, while Deputy Attorney General Charles Smith will take Traylor's job.

"I thank Dr. Janek for his years of dedication and service to the State of Texas," Abbott said in a news release. "I look forward to working with Chris Traylor to make needed reforms to ensure that the millions of Texans who rely on the vital services HHSC performs are able to have the utmost trust in the agency."

Traylor, who is well-known and well-liked by state lawmakers, had been seen as a potential pick for the top spot, but had decided to retire before being talked out of it by the governor, Janek said.

Traylor as co-captain

A longtime health commission leader, he was seen inside the agency as more of Janek's co-captain than deputy since the two were appointed to their jobs in September 2012 by then-Gov. Rick Perry.

Perhaps most importantly, he had avoided any public blame for the scandals, which started last December, when Janek canceled a $90 million extension of a $20 million no-bid contract amid questions from the Houston Chronicle and Austin American-Statesman.

The contract for a Medicaid fraud detection system had been given to Austin technology company 21CT, which had experience in data analytics but none in Medicaid. Its lobbyist at the time of the extension was a former business partner of health commission lawyer Jack Stick, who headed the project.

Stick and then-Inspector General Doug Wilson both resigned last December. Stick's wife, Erica, who was Janek's chief of staff, followed suit the next month. Then came the departure of deputy chief of staff Casey Haney, who left after it surfaced that he had gotten $97,000 in advance to go to graduate school.

An independent review ordered by Abbott later found the 21CT contract skirted state law "at the very least" and was only a symptom of larger management problems at the agency.

Janek insisted he had been "misled" by his aides.

As a criminal probe began and news stories examined other contracts and other problems at the health commission, however, the commissioner increasingly was the target of calls to step down.

To the surprise of many at the Capitol, the former anesthesiologist and one-term senator held on until the end of the session.

He told reporters Friday that he had approached Abbott's office about leaving "a few weeks ago," toward the end of the legislative session that wrapped up Monday.

"I wanted to wait until the right time things started to die down a little bit in the governor's office where I could get some time and sort of lay out the scenario in front of the governor's office," Janek said.

Part of what made the timing right, he said, was the Legislature's move to consolidate the sprawling health agency, which will necessitate a time of transition.

Janek defended his tenure, saying he had worked to improve the Child Protective Services division and dealt with the first case of Ebola in America, in addition to a surge in unaccompanied minors crossing the border.

"I really won't grade my paper in front of other people because they could ridicule it," Janek said, adding later that, "I will tell you what I did as commissioner. And that was to give it everything I had."

Investigation ongoing

Gregg Cox, director of the Public Integrity Unit at the Travis County District Attorney's Office, said an investigation into contracting problems at the agency was continuing.

"All I can say is that it's ongoing and we're making progress," Cox said.

Lawmakers and advocates focused on the future, with few commenting on Janek's departure, but many applauding the appointment of Traylor.

"I am thankful Commissioner Traylor agreed to forego his retirement," state Senate budget writer Jane Nelson, R-Flower Mound, said in a statement. "His institutional memory and his understanding of the mechanics of our programs will be a huge asset, especially as we transition to a more cohesive health and human services system."

F. Scott McCown, an advocate and former district judge who served on the team appointed by Abbott to review the health commission, said "appointing Chris Traylor executive commissioner is a big step toward solving those problems."

Traylor, a 52-year-old Lubbock native who cut his teeth in the office of former U.S. Sen. Phil Gramm, has worked in Texas health services since 1997. Among other jobs, he has led the commission's Medicaid division and the Department of Aging and Disability Services.

"I really think that he is the right person, at the right place, at the right time," said Rep. Richard Peña Raymond, D-Laredo, who heads the House Human Services Committee. "The governor could not have picked a better person."

Smith, the new number two, was the deputy attorney general for child support, a post he was appointed to by then-attorney general Abbott in 2013. The Texas Tech University alumnus has been with the Attorney General's office since 1988, first as a volunteer in the child support division.

Abbott signs reforms

Abbott also announced Fr iday that he signed legislation to reform state contracting policies. The law, Senate Bill 20, would strengthen document retention, contracting reporting and conflict-of-interest disclosure rules, as well as increase oversight and create a centralized contract database.

The bill was prompted by the news coverage of contracting problems at the health commission and other agencies.

"I am proud to sign this bill that ensures Texans can trust their state government to issue contracts in a fair, open and responsible manner," Abbott said in a news release.